The Toro Company (TTC) Q3 2026 earnings summary

Executive summary

• Net sales for Q3 2026 rose 8.4% year-over-year to $1.23 billion, with both professional and residential segments up over 8% and strong demand across key markets.

• Adjusted EPS reached $1.33, up 7.3% year-over-year, driven by operational performance, share repurchases, and tariff refunds.

• Returned $471 million to shareholders year-to-date via dividends and share repurchases, including $110 million in Q3.

• Completed the $210.3 million acquisition of Tornado Infrastructure Equipment, strengthening the Professional segment.

• AMP productivity initiative exceeded $125 million in run-rate savings, supporting margin expansion and operational efficiencies.

Financial highlights

• Gross margin for Q3 2026 was 34.1% (adjusted: 35.0%), up from 33.7% (adjusted: 34.4%) year-over-year.

• Adjusted operating margin improved to 13.9% in Q3 2026.

• Free cash flow for the nine months ended July 31, 2026, was $425.1 million, with a conversion rate of 127.5%.

• $358 million in share repurchases executed year-to-date.

• Net earnings for Q3 2026 were $77.0 million ($0.81 per diluted share), up 43.9% year-over-year.

Outlook and guidance

• Raised full-year net sales growth guidance to 6.3%-6.6% and adjusted EPS to $4.60-$4.65, citing healthy end markets and strong new product response.

• Q4 implied net sales growth of 3.9%-5.1% and adjusted EPS of $0.93-$0.98.

• AMP productivity initiative on track to deliver at least $125 million in run-rate savings by fiscal 2027.

• Guidance includes up to $20 million in tariff refunds, with $8 million already recorded.

• Professional segment net sales to rise mid-single digits; residential segment to be flat as it laps strong prior-year snow demand.